Narrow-minded approach to compliance costs profession
A ‘discipline and punish' style approach to compliance from auditors does little to stop licensees from repeating the same shortcuts and mistakes, a financial adviser believes.
Don Trapnell, director of Synchron, believes compliance auditors have the model backwards, with the tendency to penalise instead of teach.
He said the lack of mentoring and support from compliance auditors for advisers who may be confused by compliance processes is to the detriment of the profession.
"Currently some auditors within many licensees are identifying practices that are doing certain things wrong, placing a cross next to their name, then moving on to do the same thing with the next practice," Trapnell said.
"It doesn't provide much incentive for advisers to change their ways."
Trapnell said hiring financial service professionals instead of auditors could correct this imbalance and encourage advisers to adhere to regulatory practices in the longer term.
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